<PAGE>
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
<PAGE>
PLAYORENA INC.
------------------------------------------------------------------------------
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
------------------------------------------------------------------------------
(NAME OF PERSON(S) FILING PROXY STATEMENT,
IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.(1). Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, schedule or registration statement no.:
(3) Filing party:
(4) Date filed:
<PAGE>
PLAYORENA INC.
150 VANDERBILT MOTOR PARKWAY, SUITE 311
HAUPPAUGE, NEW YORK 11788
- --------------------------------------------------------------------------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD SEPTEMBER 7, 1999
NOTICE IS HEREBY GIVEN, that a Special Meeting of the
Shareholders of Playorena Inc. (the "Company") will be held at 36 West 44th
Street, Suite 1201, New York, New York 10036 on September 7, 1999 at 10:00 a.m.
local time, for the purpose of considering and acting upon the following, all to
be effective upon the consummation of certain transactions described herein:
1. The approval of an amendment to the Company's Certificate of
Incorporation (i) to change the name of the Company to "ETRAVNET.COM,
Inc."; (ii) to recapitulate the purposes for which the Company was
formed; (iii) to effect a reverse stock split whereby each issued and
outstanding share of Common Stock, $.001 par value per share ("Common
Stock"), will be converted into .027533 of a share of Common Stock;
(iv) to increase the authorized number of shares of Common Stock from
15,000,000 to 20,000,000; and (v) to authorize the issuance, in one or
more series, of an aggregate of 5,000,000 shares of Preferred Stock,
$.001 par value per share, each such series having the designation,
relative rights, preferences or limitations as shall be determined by
the Board of Directors; and
2. Any and all matters that may properly come before the meeting and any
adjournment thereof.
The Board of Directors has fixed the close of business on
August 17, 1999, as the record date for determining the shareholders entitled to
vote at the meeting and any adjournment thereof, and only the holders of Common
Stock of the Company of record at such date will be entitled to notice of and to
vote at the meeting. Such shareholders may vote in person or by proxy.
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING. HOWEVER,
WHETHER OR NOT YOU PLAN TO BE PERSONALLY PRESENT AT THE MEETING, PLEASE MARK,
DATE AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
By Order of the Board of Directors,
Lawrence E. Kaplan
President
Hauppauge, New York
August 20, 1999
<PAGE>
PLAYORENA INC.
150 VANDERBILT MOTOR PARKWAY, SUITE 311
HAUPPAUGE, NEW YORK 11788
-------------
PROXY STATEMENT
-------------
GENERAL INFORMATION CONCERNING SOLICITATION
This proxy statement is furnished in connection with the
solicitation of proxies by and on behalf of the Board of Directors of Playorena
Inc. (the "Company"), to be held at 36 West 44th Street, Suite 1201, New York,
New York 10036 on Tuesday, September 7, 1999 at 10:00 a.m. local time, or any
adjournments thereof. This Proxy Statement and accompanying proxy card are first
being sent to the shareholders of the Company on or about August 20, 1999.
Any proxy delivered in the accompanying form may be revoked
by the person executing the proxy at any time, before the authority thereby
granted is exercised, by written request addressed to the Secretary, Playorena,
Inc., 150 Vanderbilt Motor Parkway, Suite 311, Hauppauge, New York 11788, or by
attending the meeting and electing to vote in person. Proxies received in such
form will be voted as therein set forth at the meeting or any adjournment
thereof, but if no instructions are given, such shares will be voted for (i) the
approval of an amendment to the Company's Certificate of Incorporation (a) to
change the name of the Company to "ETRAVNET.COM, Inc." (b) to recapitulate the
purposes for which the Company was formed, (c) to effect a reverse stock split
whereby each issued and outstanding share of Common Stock, $.001 par value per
share ("Common Stock"), will be converted into .027533 of a share of Common
Stock (the "Reverse Stock Split"), (d) to increase the authorized number of
shares of Common Stock from 15,000,000 to 20,000,000, and (e) to authorize the
issuance, in one or more series, of an aggregate of 5,000,000 shares of
Preferred Stock, $.001 par value per share, each such series having the
designation, relative rights, preferences and limitations as shall be determined
by the Board of Directors; and (ii) the transacting of such other business as
may properly come before the meeting or any adjournment thereof. The effective
date of all such proposals approved of at the meeting shall be the consummation
of a transaction described under "The Transaction" herein.
RECORD DATE AND VOTING SECURITIES
The Board of Directors has selected the close of business on
August 17, 1999 as the record date ("Record Date") for determining the
shareholders entitled to notice of, and to vote at, the meeting or any
adjournment thereof. Shareholders present or represented and entitled to vote on
any matter at the meeting or any adjournment thereof will be entitled to one
vote on such matter for each share of the Common Stock of the Company held by
them as of the record date.
THE TRANSACTION
THE MERGER
The Company intends to acquire the business of Global Travel
Network, LLC, a limited liability company organized under the laws of the state
of Delaware ("Global").
Global is a leading franchiser of independently-owned travel
agencies. In operation since 1982, Global now has over 400 locations throughout
the United States, including over 50 franchises located within Wal-Mart
supercenter stores, and international franchised agencies in 21 countries.
Global has forged a strategic alliance with GoGo Tours, a leading wholesaler of
travel packages. Separately, Liberty Travel, a major retailer of travel product,
acquired a 10% interest in Global prior to the Merger.
<PAGE>
A wholly-owned subsidiary of the Company will merge with and
into Global in exchange for shares of Common Stock of the Company, with Global
as the surviving corporation (the "Merger"). Following the Merger, Global will
be a wholly-owned subsidiary of the Company.
The Merger will be completed pursuant to the Agreement and
Plan of Merger, dated as of July 27, 1999, by and among the Company, a
subsidiary of the Company, Global and the members of Global ("Global Merger
Agreement"), pursuant to which the Company's wholly-owned subsidiary formed for
such purposes will merge into Global in a tax free reorganization within the
meaning of Sections 351 and/or 368 of the Internal Revenue Code of 1986, as
amended. Members of Global will exchange their membership interests in Global
for an aggregate of 4,725,000 shares of Common Stock of the Company ("Global
Purchase Stock").
See "Certain Relationships and Related Transactions" below
for certain obligations being undertaken by certain officers, members and
affiliates of the Company in connection with the Merger.
CHANGE IN CONTROL OF THE COMPANY
Giving effect to the Merger and the Reverse Stock Split, the
Company's current shareholders will own, on a fully diluted basis, approximately
5.5% of the outstanding voting securities of the Company. The current
shareholders of the Company shall own an aggregate of approximately 275,000
shares of Common Stock.
APPROVAL OF PROPOSALS REQUIRED TO EFFECT THE MERGER
The approval of each of the proposals contained herein is a
condition precedent to, or is otherwise in connection with, the consummation of
the Merger. Assuming approval by shareholders, the proposals contained in this
Proxy Statement shall be effective concurrent with the consummation of the
Merger.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Lawrence Kaplan and Robert Rubin, each a principal
shareholder and director of the Company, upon consummation of the Merger and as
an accommodation to the Company, will execute and deliver an Assumption and
Indemnification Agreement, pursuant to which each such individual will agree,
jointly and severally for a period of up to one year from the Closing, to
indemnify and hold harmless the Company for all claims and liabilities with
respect to (i) virtually all pre-existing payables and liabilities of the
Company prior to the consummation of the Merger (which liabilities they will
assume), (ii) any breach of a representation or warranty of the Company
(respecting matters no more than five years old) in any document respecting the
Merger and (iii) any default by the Company with respect to its obligations
pursuant to the Merger prior to the consummation of the Merger.
On August 1, 1998, after giving effect to a previously
approved one-for-20 reverse stock split which was effective July 24, 1998,
Robert Rubin, Lawrence Kaplan, Alfred Romano (members of the Company's Board of
Directors) and Andrew Kaplan, a principal shareholder of the Company, purchased
3,049,944, 2,330,303, 138,113 and 2,335,417, shares of Common Stock of the
Company, respectively, for a purchase price equal to the amounts owed for the
cancellation of all indebtedness (and interest thereon) and for all previous
services rendered. On July 13, 1999, Robert Rubin and Lawrence Kaplan purchased
55,245 and 41,434 shares of Common Stock of the Company, respectively, in
exchange for certain cash contributions made by each of them to the Company.
On July 27, 1999, Lawrence Kaplan and Robert Rubin, along
with Andrew Kaplan, a principal shareholder, signed a Voting Agreement with
Global, pursuant to which they agreed to vote all their shares of Company Common
Stock in favor of the proposals set forth herein. As a result, the approval of
the proposals is essentially assured.
Effective upon consummation of the Merger, each of the
current directors and officers will resign from their positions, to be replaced
by nominees of Global.
2
<PAGE>
EXECUTIVE COMPENSATION
The summary compensation table is omitted because no
compensation for services in all capacities to the Company was awarded, earned
by or paid to the President of the Company for the fiscal years ended November
30, 1998, 1997 or 1996, and no other executive officer of the Company received
salary and bonus in excess of $100,000 during the fiscal years ended November
30, 1998, 1997 or 1996.
No director of the Company received any remuneration from
the Company as such. Directors do not currently receive fees or other
remuneration from the Company.
PRINCIPAL SHAREHOLDERS AND HOLDINGS OF MANAGEMENT
The following table sets forth certain information as of
July 28, 1999, regarding (i) each person known by the Company to be the
beneficial owner of more than 5% of the outstanding shares of Common Stock, (ii)
each director, nominee and executive officer of the Company and (iii) all
officers and directors as a group.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
NAME & ADDRESS OF OF BENEFICIAL PERCENTAGE
TITLE OF CLASS BENEFICIAL OWNER OWNERSHIP OF CLASS
- --------------- -------------------------------- ----------------- ----------
<S> <C> <C> <C>
Common Stock Lawrence Kaplan 2,426,459 24.29%
150 Vanderbilt Motor Parkway
Suite 311
Hauppauge, New York 11788
Common Stock Andrew Kaplan 2,389,583 23.92%
150 Vanderbilt Motor Parkway
Suite 311
Hauppauge, New York 11788
Common Stock Robert Rubin 3,241,355 32.45%
25 Highland Boulevard
Dix Hills, New York 11746
Common Stock Alfred Romano 138,668 1.38%
4 Wagon Wheel Lane
Dix Hills, New York 11746
All Directors and Executive Officers as group 5,806,482 58.13%
(3 persons)
</TABLE>
Giving effect to the consummation of the Merger and the
Reverse Stock Split, the current shareholders of the Company will collectively
own approximately 5.5% of the outstanding voting securities of the Company, on a
diluted basis. Concurrent with the closing of the Merger, the incumbent officers
and directors of the Company will be replaced by the officers and directors of
Global.
PROPOSAL 1--AMENDMENT TO THE CERTIFICATE OF INCORPORATION ("AMENDMENT") (A) TO
CHANGE THE NAME OF THE COMPANY TO ETRAVNET.COM, INC., (B) TO RECAPITULATE THE
PURPOSES FOR WHICH THE COMPANY WAS FORMED, (C) TO EFFECT A REVERSE STOCK SPLIT
WHEREBY EACH ISSUED AND OUTSTANDING SHARE OF COMMON STOCK, $.001 PAR VALUE PER
SHARE, WILL BE CONVERTED INTO 0.027533 OF A SHARE OF COMMON STOCK, (D) TO
INCREASE THE AUTHORIZED NUMBER OF SHARES OF COMMON STOCK FROM 15,000,000 TO
20,000,000, AND (E) TO AUTHORIZE THE ISSUANCE, IN ONE OR MORE SERIES, OF AN
AGGREGATE OF 5,000,000 SHARES OF PREFERRED STOCK, $.001 PAR VALUE PER SHARE,
EACH SUCH SERIES HAVING THE DESIGNATION, RELATIVE RIGHTS, PREFERENCES AND
LIMITATIONS, AS SHALL BE DETERMINED BY THE BOARD OF DIRECTORS.
BOARD RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL.
Proxies solicited by the Board of Directors will be so voted unless shareholders
specify otherwise in their proxy.
3
<PAGE>
DESCRIPTION
A. CHANGE OF NAME
Global has requested that the Company's name be changed to
"ETRAVNET.COM, Inc." Global desires that, upon the completion of the Merger, the
Company's name reflect its business as a national travel service and agency
offering both retail and Web-based services.
B. RECAPITULATION OF PURPOSES OF THE COMPANY
The purposes for which the Company was formed, as set forth
in its Certificate of Incorporation ("Certificate"), shall be recapitulated by
stating that the purpose of the Company shall be to engage in any lawful act or
activity for which a corporation may be organized under the New York Business
Corporation Law, other than any act or activity requiring the consent or
approval of any state official, department, agency, board or other body without
such approval or consent first being obtained. Although the Certificate
presently permits the Company to engage in any lawful act or activity, the
Certificate also sets forth specific purposes such as the operation of gymnasium
facilities for recreational and general health purposes. In anticipation of the
completion of the Transactions, Global desires that the Company's Certificate no
longer reflect the prior business of the Company.
C. REVERSE STOCK SPLIT
REASON FOR REVERSE STOCK SPLIT; DILUTION
The consummation of the Merger is contingent upon each share
of Common Stock issued and outstanding, without any action on the part of any
holder thereof, being converted into .027533 of a share of Common Stock.
Shareholders holding shares of Common Stock in an amount not divisible by
.027533 will receive, in lieu thereof, one full additional share.
The Reverse Stock Split would apply to all shares of the
Company's Common Stock outstanding on the date immediately prior to the closing
of the Merger, but will not be effective until the consummation of the Merger.
Giving effect to the consummation of the Merger, the holders of Common Stock
will collectively own approximately 5.5% of the outstanding voting securities of
the Company on a diluted basis.
The principal purpose of the Reverse Stock Split is to
fulfill the provisions and requirements of the Global Merger Agreement, which
provides that the Company's currently outstanding Common Stock be reduced to
approximately 275,000 shares of Common Stock.
EXCHANGE OF STOCK CERTIFICATES
Assuming the Reverse Stock Split is approved by the
shareholders, shareholders will be required to exchange their stock certificates
for new certificates representing the shares of Common Stock giving effect to
the Reverse Stock Split. The new stock certificates will also reflect a prior
one-for-twenty reverse stock split approved by the shareholders at a special
meeting held on February 7, 1997, and effected as of July 31, 1998. Shareholders
will be furnished with the necessary materials and instructions for the
surrender and exchange of stock certificates at the appropriate time by the
Company's transfer agent. Shareholders will not be required to pay a transfer or
other fee in connection with the exchange of certificates. SHAREHOLDERS SHOULD
NOT SUBMIT ANY CERTIFICATES UNTIL REQUESTED TO DO SO.
FEDERAL INCOME TAX CONSEQUENCES OF REVERSE STOCK SPLIT
The following description of Federal income tax consequences
is based upon the Internal Revenue Code of 1986, as amended, the applicable
Treasury Regulations promulgated thereunder, judicial authority and current
administrative rulings and practices as in effect on the date of this Proxy
Statement. This discussion is for general information only and does not discuss
consequences which may apply to special classes of taxpayers (e.g., non-resident
aliens, brokers-dealers or insurance companies). Shareholders are urged to
consult their own tax advisors to determine the particular consequences to them.
4
<PAGE>
The exchange of shares of Common Stock for shares of Common
Stock giving effect to the Reverse Stock Split will not result in recognition of
gain or loss. The holding period of the shares of new Common Stock will include
the shareholder's holding period for the shares of Common Stock exchanged
therefor, provided that the shares of Common Stock were held as a capital asset.
The adjusted basis of the shares of new Common Stock will be the same as the
adjusted basis of the shares of Common Stock exchanged therefor.
D. INCREASE THE AUTHORIZED NUMBER OF SHARES OF COMMON STOCK FROM 15,000,000 TO
20,000,000.
The Company's authorized capital stock consists of
15,000,000 shares of Common Stock, $.001 par value per share. Global has
requested the amendment of the Company's Certificate of Incorporation to
increase the authorized number of shares of Common Stock from 15,000,000 to
20,000,000. This will enhance Global's flexibility in issuing shares to complete
acquisitions, reward employees, convert obligations or for other purposes, but
Global has not stated its current intent to do so.
E. AUTHORIZATION TO ISSUE, IN ONE OR MORE SERIES, AN AGGREGATE OF 5,000,000
SHARES OF PREFERRED STOCK, $.001 PAR VALUE PER SHARE, EACH SUCH SERIES HAVING
THE DESIGNATION, RELATIVE RIGHTS, PREFERENCES OR LIMITATIONS, AS SHALL BE
DETERMINED BY THE BOARD OF DIRECTORS.
The Company seeks to amend its Certificate of Incorporation
to authorize the issuance of 5,000,000 shares of Preferred Stock. The Board of
Directors has adopted and submitted to shareholders for approval an amendment to
its Certificate to authorize the issuance of up to 5,000,000 shares of Preferred
Stock, $.001 par value per share.
After the filing of the Amendment, the Board of Directors of
the Company shall have the authority to specify the designation, relative
rights, preferences and limitations of up to 5,000,000 shares of Preferred
Stock. It is not possible to determine the actual effect of any to-be designated
series of Preferred Stock on the rights of the shareholders of the Company until
the Board of Directors determines the rights of the holders of such series of
the Preferred Stock. However, such effects might include (i) restrictions on the
payment of dividends to the holders of the Common Stock, (ii) dilution of voting
power to the extent that the holders of shares of Preferred Stock are given
voting rights, (iii) dilution of the equity interests and voting power if the
Preferred Stock is convertible into Common Stock, and (iv) restrictions upon any
distribution of assets to the holders of the Common Stock upon liquidation or
dissolution, and until the satisfaction of any liquidation preference granted to
the holders of Preferred Stock. Shareholders will not have preemptive rights to
subscribe for shares of Preferred Stock.
The Board of Directors believes that the authorization of
the Preferred Stock is in the best interests of the Company and its
shareholders, and believes that it is advisable to authorize such shares and
have them available in connection with possible future transactions such as
financings, strategic alliances, corporate mergers, acquisitions, possible
funding of new product programs or businesses and other uses not presently
determinable and as may be deemed to be feasible and in the best interests of
the Company. In addition, the Board of Directors believes that it is desirable
that the Company have the flexibility to issue shares of Preferred Stock without
further shareholder action, except as otherwise provided by law.
The proposed Certificate of Amendment to the Company's
Certificate of Incorporation is attached hereto as Exhibit A.
OTHER BUSINESS
The Board of Directors of the Company knows of no other
matters to be presented at the Special Meeting of Shareholders. However, if any
other matters properly come before the meeting, or any adjournment thereof, it
is intended that proxies in the accompanying form will be voted in accordance
with the judgment of the persons named therein.
5
<PAGE>
CANCELLATION OF PREVIOUSLY SCHEDULED MEETING
As contemplated in connection with the proposed acquisition
of two separate companies which are providers of wireless voice and data
products and systems to the private two-way land mobile radio industry (the
"Terminated Acquisitions"), as more particularly described in the Company's most
recent Annual Report on Form 10-KSB, a proxy statement was mailed to
shareholders of the Company on or about February 9, 1999, calling a special
meeting of shareholders for February 19, 1999 (the "Meeting"), and requesting
approval by the Company's shareholders of certain matters related to the
Terminated Acquisitions.
As a result of certain uncertainties concerning the
Terminated Acquisitions, on February 19, 1999, the Meeting was duly called to
order, upon which the shareholders of the Company voted to adjourn the Meeting
until March 11, 1999. On March 11, 1999, the Meeting was called to order and the
shareholders voted to adjourn the Meeting to April 12, 1999. On April 12, 1999
the Meeting was called to order and the shareholders voted to adjourn the
Meeting to May 18, 1999. On May 18, 1999 the meeting was called to order and was
thereupon canceled because the other parties to the Terminated Acquisitions
canceled the agreement relating thereto on April 22, 1999.
COST OF SOLICITATION
Solicitation other than by mail may be made personally and
by telephone by regularly employed officers and employees of the Company who
will not be additionally compensated therefor. The Company will request brokers,
dealers, banks or voting trustees, or their nominees, who hold stock in their
names for others or hold stock for others who have the right to give voting
instructions, to forward proxy materials to their principals and request
authority for the execution of the proxy card and will reimburse such
institutions for their reasonable expenses in so doing. The total cost of
soliciting proxies will be borne by the Company.
It is important that your shares be represented at the
meeting. If you are unable to be present in person, you are respectfully
requested to sign the enclosed proxy and return it in the enclosed stamped and
addressed envelope as promptly as possible.
By Order of the Board of Directors,
Lawrence E. Kaplan
President
Hauppauge, New York
August 20, 1999
6
<PAGE>
EXHIBIT A
CERTIFICATE OF AMENDMENT TO THE
COMPANY'S CERTIFICATE OF INCORPORATION OF
PLAYORENA INC.
UNDER SECTION 805 OF THE BUSINESS CORPORATION LAW
The undersigned President of PLAYORENA INC. ("Corporation"),
does hereby certify and say:
1. The name of the corporation is PLAYORENA INC.
2. The Certificate of Incorporation was filed by the
Department of State of the State of New York on December 4, 1981.
3. Article FIRST of the Certificate of Incorporation, which
sets forth the name of the Corporation, is hereby amended to read as follows:
FIRST: The name of the Corporation is ETRAVNET.COM, Inc.
4. Article SECOND of the Certificate of Incorporation, which
sets forth the purposes for which the Corporation was formed, is hereby amended
to read as follows:
SECOND: The purpose of the corporation is to engage in any lawful act or
activity for which corporations may be organized under the New York
Business Corporation Law, other than any act or activity requiring the
consent or approval of any state official, department, agency, board or
other body without such approval or consent first being obtained.
5. Article THIRD of the Certificate of Incorporation, which
sets forth the location of the Corporation's office in the State of New York, is
hereby amended to read as follows:
THIRD: The office of the corporation within the State of New York shall
be located in [New York County.]
6. Article FOURTH of the Certificate of Incorporation, which
sets forth the aggregate number, class, and par value of the shares which the
Corporation shall have the authority to issue, is hereby amended to increase the
authorized number of shares of common stock which the Corporation shall have the
authority to issue and to authorize the issuance of a new class of preferred
stock. Article FOURTH, as amended hereby, shall read in its entirety as follows:
FOURTH: The aggregate number of shares which the corporation shall have
the authority to issue is Twenty-Five Million (25,000,000) shares, of
which (i) Twenty Million (20,000,000) shares shall be designated as
Common Stock ("Common Stock") and shall have a par value of $.001 per
share, and (ii) Five Million (5,000,000) shares shall be designated as
Preferred Stock ("Preferred Stock") and shall have a par value of $.001
per share.
The Preferred Stock may be issued in one or more
series, from time to time, with each such series to have such
designation, relative rights, preferences or limitations, as shall be
stated and expressed in the resolution or resolutions providing for the
issue of such series adopted by the Board of Directors of the
Corporation, subject to the limitations prescribed by law and in
accordance with the provisions hereof, the Board of Directors being
hereby expressly vested with authority to adopt any such resolution or
resolutions. The authority of the Board of Directors with respect to each
series of Preferred Stock shall include, but not be limited to, the
determination or fixing of the following:
i) The distinctive designation and number of shares
comprising such series, which number may (except where otherwise provided
by the Board of Directors in creating such series) be
A-1
<PAGE>
increased or decreased (but not below the number of shares then
outstanding) from time to time by like action of the Board of Directors;
ii) The dividend rate of such series, the conditions
and time upon which such dividends shall be payable, the relation which
such dividends shall bear to the dividends payable on any other class or
classes of stock or series thereof, or any other series of the same
class, and whether such dividends shall be cumulative or non-cumulative;
iii) The conditions upon which the shares of such
series shall be subject to redemption by the Corporation and the times,
prices and other terms and provisions upon which the shares of the series
may be redeemed;
iv) Whether or not the shares of the series shall be
subject to the operation of a retirement or sinking fund to be applied to
the purchase or redemption of such shares and, if such retirement or
sinking fund be established, the annual amount thereof and the terms and
provisions relative to the operation thereof;
v) Whether or not the shares of the series shall be
convertible into or exchangeable for shares of any other class or
classes, with or without par value, or of any other series of the same
class, and, if provision is made for conversion or exchange, the times,
prices, rates, adjustments and other terms and conditions of such
conversion or exchange;
vi) Whether or not the shares of the series shall
have voting rights, in addition to the voting rights provided by law,
and, if so, the terms of such voting rights;
vii) The rights of the shares of the series in the
event of voluntary or involuntary liquidation, dissolution or upon the
distribution of assets of the Corporation;
viii) Any other powers, preferences and relative
participating, optional or other special rights, and qualifications,
limitations or restrictions thereof, of the shares of such series, as the
Board of Directors may deem advisable and as shall not be inconsistent
with the provisions of this Certificate of Incorporation.
The holders of shares of the Preferred Stock of each
series shall be entitled to receive, when and as declared by the Board of
Directors, out of funds legally available for the payment of dividends,
dividends (if any) at the rates fixed by the Board of Directors for such
series before any cash dividends shall be declared and paid or set apart
for payment, on the Common Stock with respect to the same dividend
period.
The holders of shares of the Preferred Stock of each
series shall be entitled, upon liquidation or dissolution or upon the
distribution of the assets of the Corporation, to such preferences as
provided in the resolution or resolutions creating such series of
Preferred Stock, and no more, before any distribution of the assets of
the Corporation shall be made to the holders of shares of the Common
Stock. Whenever the holders of shares of the Preferred Stock shall have
been paid the full amounts to which they shall be entitled, the holders
of shares of the Common Stock shall be entitled to share ratably in all
remaining assets of the Corporation.
7. The stated capital of the Corporation is reduced from
$ to $ by changing issued shares with par value
into a lesser number of shares with the same par value.
8. This amendment provides for the following changes of
shares:
Issued Shares. The amendment provides for a change in the previously
authorized and issued 9,988,018 shares of common stock, $.001 par value
per share, into 275,000 shares of common stock, $.001 par value per
share, in the ratio of .027533 share for each share of common stock.
Unissued Shares. The amendment provides for a change in the previously
authorized and unissued 5,011,982 shares of common stock, $.001 par value
per share, into 137,995 shares of common stock, $.001 par value per
share, in the ratio of .027533 shares of common stock,
A-2
<PAGE>
$.001 par value per share for each share of common stock, without giving
effect to the changes set forth in Section 6 above.
9. The foregoing amendment to the Certificate of
Incorporation was authorized by the Board of Directors followed by approval by
the holders of a majority of all outstanding shares entitled to vote thereon at
a meeting of shareholders.
IN WITNESS WHEREOF, I have subscribed this certificate this
day of September, 1999 and I hereby
affirm the statements contained herein as true under the penalties of perjury.
------------------------------
Lawrence Kaplan, President
A-3
